Artists only received 12% of the revenue generated in the music industry in the United States in 2017 according to a new report by Citigroup.
The report, Putting The Band Back Together, which was carried out by a group of Citigroup researchers and analysts, shows that roughly $5 billion of a total $43 billion generated in the United States’ industry went to artists. Most of the money instead went to distributors like radio stations, tech companies, Internet sources like Apple, Pandora, Sirius, and Spotify, as well as to record labels.
While the percentage may be meagre, it is in fact an improvement from previous years. In 2000, for instance, artists only took away %7 of the total revenue generated. This increase, the report indicates, is largely thanks to the current health of the concert business as well as the fact that more and more artists are releasing their music themselves, thus being able to keep more of the earnings.
The report suggests three ways through which the industry could evolve in order to ensure that artists make receive more revenue. They suggest that concert promoters could merge with existing distribution platforms as a way of “vertical integration”. Secondly, they suggest that distribution platforms could consolidate in a form of “horizontal integration”. Thirdly then, they suggest a form of organic integration whereby web-based distributors could themselves form sorts of record labels by targeting young, less established artists. “This would allow artists to capture more of music’s value while allowing Internet-based music distributors to capture profit pools currently earned by the music labels,” the report says.
You can read the report in its entirety here.
Last week, Forbes released their list of the top 15 highest paid DJs of the past year with Calvin Harris coming out on top once again earning an estimated $48 million a year.
Also last week, Spotify reported a net loss of $461 million. Despite that, the streaming giant has shown no signs of real struggle and seems only to be going from strength to strength.
Recently, DJ Mag investigated the potential impact on creativity, tech and culture if streaming services are to make their way into the DJ booth.
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